The Turkish industry will take a big leap in 2016 towards fulfilling the goals of 2023 because the Domestic Goods Communique and Industrial Cooperation Program (ICP) that started to be implemented as of 2015 was published in the official gazette and the importance attached to domestic goods became more prominent. The Domestic Goods and Industrial Cooperation Program (Offset Program) that could not be implemented for years has finally become a state policy. Regarding rail transportation systems, 100 express trains, 1000 EMU, DMU trains to be tendered and 7000 metros, trams and light rail vehicles to be purchased for the city transportation by 2023 besides the infrastructure will enable to keep approximately 100 billion USD in the national economy and thus, be a driving force for the Turkish Industry in financial terms.

By requiring minimum 51% local content rate in tenders that worth 750 billion USD in Aviation and Defense, Energy, Transportation, Communication, Information Technologies and Health sectors in the country by 2023, the half of this worth, 375 billion USD, is planned to be kept in the country. Only the Industrial Cooperation Program (ICP), formerly named as the Offset sanction, will eliminate the current deficit problem that has been one of the biggest problems of Turkey for years.

Moreover, as per the decision that has recently been taken by the government, the import substitution will help to substitute most of the technological import goods with domestic goods in 2016, which will contribute substantially in the national economy.

The Railways and Municipalities bought 2200 vehicles including metros, light rail trains (LRT) and trams of various brands from various countries in 11 cities including especially Istanbul as well as Ankara, Izmir, Bursa, Eskiflehir, Adana, Kayseri, Konya, Antalya, Samsun, and Gaziantep in the recent years with the fast investment projects implemented in the urban transportation, thus making Turkey ridden with foreign vehicles. Considering that an average vehicle costs about 3 million Euros, the approximately 2200 vehicles purchased cost approximately 7 billion Euros plus spare parts, labor and stock costs.

ARUS plans to produce 7000 rail transportation vehicles in Turkey, with its national metro, light rail train and tram projects designed since 2015 in order to stop this wastefulness and to produce spare parts for these vehicles and our national brand. As known, the historic decision that requires 51% local content rate in the tender on 324 metro vehicles that was held in Ankara on March 5, 2012 and won by CSR Electric Locomotive after the tremendous efforts of ARUS, which was a turning point for Turkey, has spread to the whole country and become 60% local content.

The best examples of this include;
Our national brand ‹pekböce€i produced with 47% local content requirement in the tender on 6 trams that was held by Bursa Metropolitan Municipality on 10.04.2013 and won by Durmazlar is today successfully operated on Bursa T1 line.

10 TCV Trambus vehicles were produced with 50% local content which were tendered by Malatya Municipality on 21.06.2013 and won by Bozankaya and have currently started operating in Malatya.

The national brand Istanbul tram that was designed by Istanbul Transportation Inc. and first produced on 20.01.2014 and successfully tested has 60% local content.

30 Trams which were tendered by Kayseri Municipality on 14.04.2014 requiring minimum 35% local content and won by Bozankaya now have 50% local content.

The tender on 68 Metro Vehicles for Istanbul Hacı Osman-Yenikapı Rail Public Transportation System that was held on 18.09.2014 required 40% local content and this tender was won by Hyundai EuRotem.

The tender on 144 metro vehicles for Kabatafl-Mahmut Bey line to be held by Istanbul Municipality required minimum 40% local content and it was decided to require 61% local content rate in all tenders to be held from then on.

The tender on 60 Light Rail Metro vehicles and 12 tram vehicles that was held on 23.02.2015 by Bursa Municipality required minimum 60% local content in its specifications and was won by Durmazlar, therefore as of that day, the local content rate in Rail Transportation Systems has become 60%.

Having been inspired by all these positive developments, the Minister Lütfi Elvan implemented required minimum 53% local content for high speed trains and this decision has become a milestone for cutting-edge High Speed Trains for Turkey.

The tender that was held for 12 tram vehicles by Kocaeli Municipality last month was won by Durmazlar who offered 60% local content. The tenders held by Samsun and Antalya Municipalities were participated by Durmazlar and Bozankaya with the commitment to provide 60% local content.

In the tender on 38 Tram vehicles that was held by Izmir Municipality and did not require local content in the specifications, Hyundai Eurotem offered 48% local content.

Many municipalities started to require minimum 51% local content rate in tenders now and support our industrialists. Some examples include Istanbul, Ankara, Bursa, Kayseri, Malatya and Kocaeli municipalities. ARUS Clustering would like to congratulate these municipalities for their support for our industrialists and domestic products and hope that other municipalities also contribute in the development of our industrialists, domestic production, and thus the national economy.

A similar practice started in China 10 years ago and with the 70% local content rate in all foreign purchases in rail transportation systems as per the state policy and cooperations with Chinese companies – know-how transfers, they created their national industry.

From 2006 to 2012, leading companies including Bombardier, Alstom, Siemens etc. achieved 3% growth in rail transportation systems, while Chinese companies CNR and CSR achieved a mean of 25% growth, thus becoming the biggest producer of rail transportation systems in the world today. Compared to 2000, China has increased its capacity 15 times and reached to a capacity of 3000 metro vehicles/year.

Likewise, we will support our industrialists and brands with state policies including SIP, domestic goods, and import substitutions in the tenders of the state, municipalities and all public institutions and organizations and eliminate the invasion of foreign goods and wastefulness, and we will become a country that produces competitive national brands in the global market of 2 trillion USD.

Here is our National Express Train project, National Passenger Train and National Freight Train, ‹pekböce€i brand, Green City LRT, TCV Trambus and the new tram brand, Istanbul Tram, trams and light rail vehicles to be produced in Bursa, Kayseri, Kocaeli, Antalya, Samsun, Izmir, Eskiflehir, and Sakarya, National Trambus that is put to service in Malatya, National trains and national metro vehicle projects to be carried out by 2023 as part of the National Express Train project, which ARUS is a part of – all testaments to this development.

Therefore, we will support our national brands with a national state policy and spread these projects to the whole country, so that our industrialists, workers, and engineers will not be unemployed and the wheels of the national industry will keep on spinning very rapidly. We will produce our own products.

Now, with the Domestic Goods Communique, Industrial Cooperation Programs (S‹P) and revisions introduced in the public tender law, our state policy has started to form and domestic production has become more prominent. Today public tenders that do not include a local content rate requirement are cancelled. Turkey has entered a critical process in terms of domestic production and national brand in 2015 and 2016.

Today the companies that are a part of ARUS Clustering have the capital to bid in the local and foreign tenders on rail transportation systems. The companies now have the power to bid easily in tenders of 100 million Euros. Kardemir Iron and Steel factory, after the rail production line, invested 160 million USD in the railway wheel production. Kardemir, in its facility equipped with today’s cutting-edge technology and with a capacity of 400.000 tons/year, produces and exports rails up to 72 meters in length. This investment has enabled Kardemir to export in world markets, primarily in all of the Middle East as well as Asian and North African countries and strengthened Kardemir’s place in the sector and made Kardemir the only strategic facility that produces the above-mentioned products in Turkey and the countries in the region. Our Railway Companies achieved an export of 165 million USD in 2011. The amount of exports started to decline due to the crises and civil wars occurring in the neighboring countries as of 2011.

However, reviewing the railway network length, passenger and freight transportation and the number of wagons used in the last 4 years, we see that 70.284.000 passengers have traveled, 25.666.000 Tons of freight have been carried, 12 high speed trains and 542 locomotives served on the 12.800 km railway line as of 2012. These figures keep going up with new investments especially in the recent years. The figures of the above-mentioned developments are provided below to span the last four years.

With the investments that have been made since 2003, Turkey is today the 8th country in the world and 6th in Europe among countries that operate High Speed Trains. The freight transportation which was 15.9 million tons in 2003 increased to 25.4 million tons in 2011. An increase of 62% was achieved in the amount of freight transportation. The number of passengers increased from 77 million in 2003 to 121 million in 2011, achieving 58% increase with the express train. The number of passengers carried on metros, LRTs and trams is approximately 912 million per year.

The goal for 2023 is to increase the share of railway freight transportation to 20% and passenger transportation to 15%.

Moreover, the total railway network is planned to become 25.940 km including 10.000 km express train lines and 4000 km conventional train lines in 2023. It is planned to add 3000 km new railways in 2023-2035, thus increasing the total railways to 30.000 km as well as to realize high speed train connections in 15 cities with 60 million population, to maximize domestic production and to present our railway products to global markets, to integrate railways to other public transportation systems and to develop urban smart transportation infrastructure and systems, to establish and to extend an international combined transportation and fast supply chain management, to become competent and have a say in railway research, training and certification, to complete railway lines and connections above the Straits and the Gulf, thus becoming an important railway corridor after the energy corridor between Asia-Europe-Africa, to revive the Silk Road, and to update the legal and structural legislation on regulating railway transportation activities as per the international and the EU legislations.

In Turkey’s goals for 2023, Rail Transportation Systems and Infrastructure projects hold a total value of 100 billion USD with the urban transportation systems.

A number of railway clusters including especially Federal Republic of Germany Railways Union VDB, Japan/JORSA, Czech Republic/ ACRI, Switzerland Railways Union / Swissrail, Spain Rail Group as well as cluster companies including Siemens, Bombardier, Alstom, CAF, and Hitachi stated that they are ready to produce in Turkey by meeting minimum 51% local content rate and have already started to look for local partners and sites in Turkey.

ARUS with its members has undertaken to produce local and national brand rail transportation systems from the design to final vehicle production as per its purpose of foundation and objectives. Rail transportation systems with cheap and clean energy powered public transportation vehicles with their smart and integration systems will become indispensable for the future. In a world with ever-increasing population, the future is leaning towards rail transportation systems that offer cheap transportation and clean environment.

Our Rail Transportation Systems producers who create brands and produce technological materials hold a very high chance of getting a share from today’s world rail transportation systems market of 2 trillion USD and of achieving exports.

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